And so we halved the year with a 6.7% economic growth. And this is according to official data. Of course compared to the 8.8% economic growth of January the rates have reduced a little bit but compared to the terrible rates of the slump of the last year the 6.7%% economic growth isn’t that bad. According to the operative data of the National Statistical Service in the first half of this year the GDP of Armenia grew by 6.7% compared to the same period of the previous year. The growth was registered in all the branches of economy except for agriculture, where the plummet, according to the statisticians was 13.1%%. Instead growth was registered in the rest of the branches. The industrial growth amounted to 12.3%, electrical energy production – 15%, services – 6.1%, construction – 4.1%. In short, these data give grounds to the government and statesmen to be optimistic and be encouraging the people. Regardless of how much the Prosperous Armenia MP, deputy-chair of the financial budgetary standing committee of the NA Vardan Bostanjyan would claim that it is wrong to assess the economy in the short run this doesn’t become a hurdle for the government officials to express their judgments about the data that are released after the 20th of each month. Perhaps among them the most punctual is the head of the NA Standing committee on financial and budgetary issues Gagik Minasyan, who as usual describes the economy in positive hues. This time as well he considered the registered figures “more than eloquent.” Speaking at a news conference, Gagik Minasian, head of a parliament committee on finance, budget and credit issues, said the inflation rate dropped by 1.1% from three previous months to 7.3 % from 8.4% . He said despite this positive trend the government will work to bring it down to 5.5% to make it in tune with its projected target for 2010. Others think that it’s not right to be too serious about the data of the statistics service because those do not reflect the reality. For instance, the former Prime Minister Hrant Bagratyan recently said that for this year the government will draw such a nice dual-digit growth for the economy that will make Robert Kocharyan feel embarrassed. Another part of the experts is inclined to believe in the indices of growth because last year there was evident slump. It means that at the expense of basic low figures the figures of the current year grew. This is very well seen in the chart, which almost perfectly depicts the contrast between the figures of this and the last years. The deeper the slump of the previous year was the more “impressive” the figures of the current year look. Moreover, in this aspect the index of the first quarter of the current year should have been higher than the slump registered for the same period of the last year. But all this isn’t that important. In order to understand this clear we should first of all understand what an economic growth means. In our country when we say economic growth we understand the growth of the GDP. And the Gross Domestic Product means the sum of the amount of products and services provided within the state during a concrete period of time. But in normal countries the GDP growth is not resembled with economic growth, especially with development. The reason is that economic growth assumes improvement of the lifestyle of the population. If this is not there then it doesn’t make sense to speak about growth. Let us review a simple example. Let us imagine that only three subjects work in the economy – Poghos, Petros and Martiros, who jointly produce something. Last year, for example they produced good worth of 10000 USD, had a 3000 USD profit and they split the profit equally. And then Poghos decided that he doesn’t need partners any more. He urges or persuades Martiros and Petros to resign and as a result assimilates the shares of the rest of the partners. Next year instead of 10000 USD he produced 12000 USD worth of goods. And as a result has 4000 USD profit. So is this considered growth? In the expression of numbers perhaps it looks like growth but in reality it is not because one person’s lifestyle improved at the expense of the slump of others. Or let’s assume that Poghos’s business grew but he laid of his employees or cut their wages. And this means that the growth was registered only for Poghos. The same example can easily pertain to our economy. The wealth and revenues are extremely polarized. And only a small part of the population benefits from the growth. Moreover, this pertains not only to the indices of this year but also the “tiger-like” leap of the previous years. Even the most elementary textbooks of economics say that economic growth is useful and makes sense when the wealth is equally shared within the society, when life duration increases, the level of diseases decreases, the level of education and culture increases, the society becomes more capable of taking care of its needs, unemployment and poverty reach minimum level, environment is protected, crime rates are decreases and finally the confidence to future increases. Can you mention which of the above-mentioned components related to us as a result of the “protracted” economic growth of the previous years? If not then there is no need to become too thrilled. Let us refer to Vardan Bostanjyan once again because besides cautiousness he is the most sincere politician in this regard. Two days ago during the meeting with journalists he once again repeated that in rich countries the society doesn’t even care about economic growth. All that is for experts. The society only cares about what’s tangible. “Don’t ever think that this economic growth is such a big deal and that tomorrow everything is going to be great tomorrow. We will have what he have,” said Bostanjyan. We fully agree with him. All Bostanjyan has left to do is prove the same thing to his colleagues within the standing committee of the NA.
